CISCO is offering up an experimental cipher which, among other things, could help preserve the anonymity of data in cloud environments. In putting what it calls "FNR" (Flexible Naor and Reingold) into the hands of the public ( http://blogs.cisco.com/security/open-sourcing-fnr-an-experimental-block-cipher/ ), CISCO says its work is currently experimental rather than production software.
The FNR specification, described here ( http://eprint.iacr.org/2014/421.pdf ) (PDF), explains that privacy of fixed-length fields (such as collected in NetFlow formats) is an emerging challenge for cloud providers, who collect lots of telemetry for analysis and don't want to change their field formats to encrypt the information.
(Score: 2) by VLM on Tuesday June 24 2014, @11:44AM
For the very specific answer, you may want to read the second paragraph of the intro in the paper which discusses that exact topic.
Your general observations are correct. The real question isn't "why use a weird unknown algo with the feature of not having to change anything else" but "why not implement a secure system". It absolutely reeks, stinks, of security as a checkbox on some bureaucrats checklist. This would imply its almost certain to be a failure.
The specific idea is none the less interesting. I suppose not being limited to 128 bit blocks adds something to steganography, precise lengths of random data look "fishy" but a random length of random data could plausibly be random... This is probably much more useful for the people embedding secret messages into exif fields in pr0n pix than to bank DBAs.